A bullish day for Iraq stocks

BAGHDAD An Iraqi telecom company raised nearly $1.3 billion Sunday on Baghdad's small stock exchange in one of the region's biggest share offers in years – a sign of investor confidence in the fledgling private sector despite violence that still plagues the country.

The level of violence has dropped sharply since the worst sectarian fighting in 2006-07, yet bombings and shootings still kill dozens of people every month. Investors say the continued security risks, along with concerns about official red tape and corruption, have restricted the growth of Iraq's private sector.

So it was good news for the Iraq economy when nearly two-thirds of the money raised by the telecom company came from foreign buyers.

“Iraq is a very difficult place to do business in,” said Shwan Taha, head of Rabee Securities, the brokerage firm that organized Sunday's share float of Asiacell, one of Iraq's three main mobile phone service providers. “Iraq came out of a long dictatorship. We had 30 years of war and sanctions. We missed a lot of trains, not only one.”

Sunday's share sale by Asiacell more than doubled the market capitalization of the low-volume Iraq Stock Exchange in a single day, from $4.7 billion to $9.65 billion, said Rabee Securities. Regular trading of the shares is to begin today.

It was the first stock float on the ISX, which was set up in 2004, a year after the U.S.-led invasion that toppled Iraqi dictator Saddam Hussein.

Al-Rubaye said he hoped the Asiacell deal will send a signal to the government that investor interest is high and that it must do more, such as carrying out regulatory reforms, to encourage private business – and in not just energy.

User Agreement

Keep it civil and stay on topic. No profanity, vulgarity, racial
slurs or personal attacks. People who harass others or joke about
tragedies will be blocked. By posting your comment, you agree to
allow Orange County Register Communications, Inc. the right to
republish your name and comment in additional Register publications
without any notification or payment.